Total transaction value of approximately
$245 million
Hardinge Inc. (NASDAQ:HDNG), (“Hardinge” or the “Company”) a
leading international provider of advanced metal-cutting solutions
and accessories, today announced it has entered into a definitive
merger agreement under which Hardinge will be acquired by an
affiliate of Privet Fund Management LLC (“Privet”).
Under the terms of the agreement, Privet will acquire all shares
of Hardinge common stock not currently owned by Privet for $18.50
in cash, for a total transaction value of approximately $245
million. The purchase price represents a premium of 12.1% over the
closing price of $16.50 on November 1, 2017, the last unaffected
trading day prior to the public announcement by Privet that it was
evaluating a potential transaction to acquire Hardinge, and
represents a 26.7% premium over the unaffected volume weighted
average price for the three-month period ending on November 1,
2017. The purchase price also represents a premium of 8.3% over the
closing price on February 12, 2018.
The agreement was negotiated and unanimously recommended to the
Hardinge board of directors by the Strategic Alternatives Committee
(“the Committee”) of the board, which consisted solely of
independent directors and was formed to evaluate strategic
alternatives, including this potential transaction. Affiliates of
Privet currently own approximately 10.46% of the outstanding shares
of Hardinge common stock and have agreed to vote their shares in
favor of the proposed transaction.
Christopher DiSantis, Chairman of Hardinge and the Committee,
said, “We are pleased to have successfully negotiated a transaction
at this robust point in the business cycle that we believe is in
the best interests of the shareholders. The Committee, with the
assistance of our financial and legal advisors, carefully analyzed
Privet’s offer and came to this conclusion after thorough
consideration and extensive negotiation. The transaction provides
significant value and liquidity for our shareholders, as well as
continuity and opportunities for future growth for our employees,
and a full opportunity to market test the price in a rigorous
go-shop process.”
“The Committee and the independent directors of the Board
unanimously recommend that the Company’s shareholders vote in favor
of the proposed transaction,” Mr. DiSantis concluded.
Ryan Levenson, Principal and Portfolio Manager of Privet, said,
“Hardinge has been a valued partner and solutions provider to
global manufacturers for over 100 years. We believe the Company has
the talent and capabilities to advance to the forefront of
innovation. We look forward to deepening our relationship with the
Company, its global team and its customers all around the world, as
we work with Hardinge to achieve its long-term vision for
growth.”
The Transaction
Under the terms of the agreement, Privet will acquire all shares
of Hardinge common stock not currently owned by Privet for $18.50
in cash, for a total transaction value of approximately $245
million.
The transaction is subject to approval of two-thirds of the
shares of Hardinge common stock entitled to vote at the shareholder
meeting. The transaction, which is not subject to a financing
condition, is currently expected to close by the end of the second
quarter of 2018, subject to shareholder approval and other
customary closing conditions and regulatory approvals. Privet will
finance the transaction through a combination of equity and debt.
The debt financing is to be provided by White Oak Global Advisors,
LLC.
Under the terms of the merger agreement, Hardinge may solicit
acquisition proposals from third parties during a 45-day “go-shop”
period that ends on March 28, 2018. It is not anticipated that any
developments will be disclosed with regard to this process unless
the Company’s Board of Directors makes a decision with respect to a
potential superior proposal. The merger agreement provides Privet
with a customary right to match a superior proposal. There is no
assurance that this process will lead to any competing proposals or
any superior proposal. Hardinge’s outreach during the go-shop
period will be conducted by its financial advisor, BMO Capital
Markets Corp., and any person requiring further information may
contact Sean Sullivan at (212) 702-1123 or
sean.sullivan@bmo.com.
Financial and Legal Advisors
BMO Capital Markets Corp. acted as financial advisor and
Wachtell, Lipton, Rosen & Katz acted as legal advisor to the
Company’s Board of Directors. Baird acted as financial advisor and
Bryan Cave LLP served as legal counsel to Privet in connection with
the transaction.
About Hardinge
Hardinge is a leading global designer and manufacturer of high
precision, computer-controlled machine tool solutions developed for
critical, hard-to-machine metal parts and of technologically
advanced workholding accessories. The Company’s strategy is to
leverage its global brand strength to further penetrate global
market opportunities where customers will benefit from the
technologically advanced, high quality, reliable products Hardinge
produces. With approximately two-thirds of its sales outside of
North America, Hardinge serves the worldwide metal working market.
Hardinge’s machine tool and accessory solutions can also be found
in a broad base of industries to include aerospace, agricultural,
automotive, construction, consumer products, defense, energy,
medical, technology and transportation.
Hardinge applies its engineering design and manufacturing
expertise in high performance machining centers, high-end
cylindrical and jig grinding machines, SUPER-PRECISION® and
precision CNC lathes and technologically advanced workholding
accessories. Hardinge has manufacturing operations in China,
France, Germany, India, Switzerland, Taiwan, the United Kingdom and
the United States.
The Company regularly posts information on its website:
www.hardinge.com
About Privet Fund Management LLC
Privet Fund Management LLC is a private investment firm focused
on investing in and partnering with small capitalization companies.
The firm has flexible, long-term capital with the ability to
effectuate investments across all levels of the capital structure,
including going-private transactions. Privet was founded in 2007
and is based in Atlanta, GA.
Important Additional Information and Where to Find It
This communication does not constitute an offer to sell or the
solicitation of an offer to buy any securities or a solicitation of
any vote or approval. The proposed acquisition of the Company by
Privet will be submitted to the shareholders of the Company for
their consideration. The Company will file with the Securities and
Exchange Commission (“SEC”) a proxy statement of the Company. The
Company also plans to file other documents with the SEC regarding
the proposed transaction. SHAREHOLDERS OF THE COMPANY ARE URGED TO
READ THE PROXY STATEMENT AND OTHER RELEVANT DOCUMENTS THAT WILL BE
FILED WITH THE SEC CAREFULLY AND IN THEIR ENTIRETY WHEN THEY BECOME
AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT THE
PROPOSED TRANSACTION. Shareholders will be able to obtain free
copies of the proxy statement and other documents containing
important information about the Company and Privet, once such
documents are filed with the SEC, through the website maintained by
the SEC at http://www.sec.gov. Copies of the documents filed with
the SEC by the Company will be available free of charge on the
Company’s website at www.hardinge.com and clicking on “Investor
Relations” or by contacting the Company’s Investor Relations
Department at (716) 843-3908.
Participants in the Solicitation
The Company and certain of its directors and executive officers
may be deemed to be participants in the solicitation of proxies
from the shareholders of the Company in connection with the
proposed transaction. Information about the directors and executive
officers of the Company is set forth in its proxy statement for its
2017 annual meeting of shareholders, which was filed with the SEC
on March 17, 2017. This document can be obtained free of charge
from the sources indicated above. Other information regarding the
participants in the proxy solicitation and a description of their
direct and indirect interests, by security holdings or otherwise,
will be contained in the proxy statement and other relevant
materials to be filed with the SEC when they become available.
Forward Looking Statements
This communication contains forward-looking statements (within
the meaning of Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act of 1934, as
amended) that involve risks and uncertainties concerning Hardinge’s
expected financial performance and its strategic and operational
plans. Such statements are based on management's current
expectations, assumptions, estimates, and projections, as well as
information currently available to Hardinge, which involve risks
and uncertainties. Any statements that are not statements of
historical fact or that are about future events may be deemed to be
forward-looking statements. For example, words such as "may,"
"will," "should," "estimates," "predicts," "potential," "continue,"
"strategy," "believes," "anticipates," "plans," "expects,"
"intends," and similar expressions are intended to identify
forward-looking statements. The actual results or outcomes and the
timing of certain events may differ significantly from those
discussed in any forward-looking statements.
Certain factors could cause actual results to differ from those
anticipated in the forward-looking statements in this release,
including the possibility that the proposed transaction is delayed
or does not close, including due to the failure to receive required
shareholder approval, the taking of governmental action (including
the passage of legislation) to block the transaction, the failure
of Privet to obtain the equity and debt financing or other funds
required to finance the transaction, or the failure of other
closing conditions, the possibility that the expected financial
impacts will not be realized, or will not be realized within the
expected time period, including as a result of fluctuations in the
machine tool business, the cyclical nature of our markets, changes
in general economic conditions in the U.S. or internationally, the
mix of products sold and the profit margins thereon, the relative
success of our entry into new product and geographic markets, our
ability to manage our operating costs and announced cost reduction
initiatives, product liability claims, work stoppages or other
labor issues, our ability to execute on our previously announced
real estate sale and other restructuring activities, actions taken
by customers such as order cancellations or reduced bookings by
customers or distributors, competitors’ actions such as price
discounting or new product introductions, governmental regulations
and environmental matters, loss of key management or other
personnel, failure of operating equipment or information technology
infrastructure, changes in the availability and cost of materials
and supplies, the implementation of new technologies and currency
fluctuations, and other risks and factors described in our
quarterly reports on Form 10-Q and annual reports on Form 10-K and
in our other filings with the SEC or in materials incorporated
therein by reference.
We undertake no obligation to publicly update any
forward-looking statement, whether as a result of new information,
future events, or otherwise.
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version on businesswire.com: http://www.businesswire.com/news/home/20180212006399/en/
Company:Hardinge Inc.Douglas J. Malone,
607-378-4140Senior Vice President and Chief Financial
OfficerorInvestor Relations:Kei Advisors LLCDeborah K.
Pawlowski, 716-843-3908dpawlowski@keiadvisors.com
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